Employer coverage up under Massachusetts health lawNews added by Benefits Pro on May 14, 2013

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By Kathryn Mayer

If Massachusetts’ own health reform is any indication, employer-sponsored health insurance will be safe under the Patient Protection and Affordable Care Act.

In the seven years since Massachusetts enacted its universal health care law, the number of people covered by insurance at work actually increased, running counter to nationwide trends at the same time, according to report Monday from consulting firm PricewaterhouseCoopers.

Opponents of President Obama’s health reform law have argued that employers dropping health coverage for their employees will be one of the big unintended consequences of the law that will hurt employees.

But Robert Valletta, PwC U.S. healthcare provider leader, argued that “Massachusetts’ experience may offer clues into how health organizations, the business community and individuals might react to elements of the Affordable Care Act set to take effect in 2014.”

“Despite concern that the Affordable Care Act signals the end of employer-sponsored health coverage, our analysis of the Massachusetts experience paints a more complex picture,” Valletta said, noting that each state and industry is different.

Employer-sponsored insurance rose about 1 percentage point in Massachusetts while the national rate fell by 5.7 percentage points.

Researchers note the growth occurred despite the difficult economy, and at a time when premiums hit historic highs.

PwC’s Health Research Institute on Monday released the first of a two-part series called “The Massachusetts Experience,” which examines the real-world implications of health reform in the first state in the nation to move forward with a broad expansion of coverage.

Massachusetts’ health law was implemented in 2006 by then-Gov. Mitt Romney, Obama's GOP rival in the 2012 presidential election. The law has helped the state close the gap on uninsured residents; the Bay State has the country’s best rate of insured individuals, with just a 4.5 percent uninsured rate, according to Gallup numbers.

President Obama has said repeatedly that he used Massachusetts’ state health reform as a blueprint for his Patient Protection and Affordable Care Act.

Researchers also said that employer-sponsored insurance is often financially beneficial to both employers and employees.

“Employer-sponsored coverage will continue to be a critical pillar of the U.S. health system, and it has been an important part of employer strategy to attract and retain talent, and promote improved health and productivity,” said Michael Thompson, PwC U.S. human resources services principal focused on health care.

Thompson said that health insurance benefits are unlikely to go away when PPACA goes into full effect.

“Most employers see this return on investment, alone, as a compelling reason to continue offering coverage,” he said.

According to HRI’s analysis, two key factors shaped the Massachusetts experience: the individual mandate, which drove up demand for coverage, and the tax implications for both employers and employees.

The second report on the Massachusetts Experience — which will take a look at the implications for state’s hospitals, physicians and insurers — will be released later this month.

Originally published on BenefitsPro.com
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